State budget: all eyes on University of Nebraska

Last year it was an upheaval in the athletic department that made the University of Nebraska a household word. The firing of an athletic director and a head football coach brought replacements and diverted attention away from what was an even bigger issue for the school, the loss of $49 million in state aid and increased operational costs.
This year it has been a struggle with free speech issues on several fronts, including: complaints that a conservative voice is not tolerated on the Lincoln campus; scrutiny from at least three state senators calling on the University to adopt policies to correct that perception; and a widely circulated video from an alleged white supremacist student which has been protested by a large group of students.
Oh, and there has been talk of another round of budget cuts brought on by lagging state revenues and a strong desire of Governor Pete Ricketts to provide property tax relief in the ag sector and income tax relief for some.
That has led to talk of another $34-plus million in cuts to the University and has brought a warning from University President Hank Bounds that said action would be detrimental leading to cuts in academic programs.
The Legislature’s Appropriations Committee Chairman Senator John Stinner of Gering said the budget reality could have a “transformational impact” on the University. Proposed reductions of 2 percent this year and 4 percent next year are being discussed.
Bounds said the University has exhausted cuts in areas that don’t affect academic programs and cuts in information technology; energy savings and service areas could potentially damage the university’s daily operations. The school is dipping into cash reserves to cover losses for the rest of this fiscal year.
Campus leaders have been coping, but the tough decisions lie ahead, Bounds said. That will include identifying academic programs, extension offerings and research enterprises the university can do without.
For the Legislature’s part, Stinner—who has two degrees from the University of Nebraska—said there is no appetite to increase taxes for additional revenue to fund the university or other state-supported agencies or activities. Ricketts has also made it clear that he will not support tax increases, noting that Nebraska is already a high tax state. Both men are also running for re-election.
Stinner did tell the Lincoln Journal Star that he is open to a number of revenue-producing options such as the collection of state sales taxes already owed on internet sales, something that Ricketts opposes.
The senator said he’d also look at possibly applying the state sales tax to some now-exempt services and taking a fresh look at the state’s list of incentive programs. It’s all about good tax policy.
Good tax policy is an oft-discussed subject with little action. There are a handful of property tax proposals on the table this year and the specter of a ballot issue to allow voters to adopt a property tax reduction plan in November.
In the short term, we need to look at the situation with the state’s flagship educational programs. The nearly 150-year-old University of Nebraska now boasts 53,000 students with 11,000 new graduates entering the workforce every year and more than 187,000 alumni living in the state.
The One Nebraska Coalition has been sponsoring a series of advertisements and commercials in support of the University’s lobbying efforts. The group has provided some interesting statistics, such as the fact that more than 50 percent of doctors in rural Nebraska were trained at the University of Nebraska and nearly 75 percent of Nebraska farmers and ranchers have benefitted from university research to boost animal and crop productivity.
The group also says that for every dollar invested in the university by the state, $6 is added to the Nebraska economy. They foresee a loss of students, loss of jobs and closing down of some academic programs if the cutting continues.
Stinner said he knows that any time you raise tuition, it has an impact on the number of kids who can go to the university or the state or community colleges. He promised that if state revenue begins to recover, that could somewhat ease the budget pressure.
The Nebraska Economic Forecasting Advisory Board meets later this month. The Legislature and the University are both wishing and hoping for positive numbers on the state’s tax receipts.
The One Nebraska Coalition has called for Nebraskans to reach out to the Governor and the Legislature and ask them to make the University a priority.   
Consider it done.